Mbaba v. Indymac Federal Bank F.S.B. et al, No. 1:2009cv01452 - Document 17 (E.D. Cal. 2010)

Court Description: MEMORANDUM DECISION on Defendant MTC Financial Inc., dba Trustee CORPS' Motion To Dismiss 7 , signed by Judge Oliver W. Wanger on 1/27/2010. (Gaumnitz, R)

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1 2 UNITED STATES DISTRICT COURT 3 EASTERN DISTRICT OF CALIFORNIA 4 PATRICK MBABA, 1:09-CV-01452-OWW-GSA 5 Plaintiff, 6 7 v. 8 INDYMAC FEDERAL BANK F.S.B.; MTC FINANCIAL, INC. dba TRUSTEE CORPS, 9 MEMORANDUM DECISION ON DEFENDANT MTC FINANCIAL, INC., dba TRUSTEE CORPS MOTION TO DISMISS (Doc. 7) Defendants. 10 11 12 13 14 15 I. INTRODUCTION Defendant MTC Financial, Inc. dba Trustee Corps moves to dismiss Plaintiff Patrick Mbaba s Complaint on grounds, among others, that Trustee Corps is not subject to Plaintiff s claims in its limited role as foreclosure trustee. Plaintiff, proceeding pro se, has filed opposition, to which Defendant has replied. 16 17 18 19 20 21 22 23 24 25 26 27 II. BACKGROUND This case involves a dispute between Plaintiff Patrick Mbaba ( Mbaba ) and Defendants IndyMac Federal Bank ( IndyMac ) and MTC Financial, Inc. dba Trustee Corps ( Trustee Corps ), the latter a foreclosure trustee headquartered in Orange, California. The dispute concerns two mortgage loans obtained by Plaintiff on real property located at 5201 Gorman Way and 5203 Gorman Way, Bakersfield, California. On June 29, 2007, Plaintiff obtained two loans from First Capital Group, both in the amount of $142,000, which were secured by Deeds of Trust ( DOT ) on the Gorman Way properties. 28 1 (Request 1 for Judicial Notice ( RJN ), Doc. 7-2, Exhs. A-B.1) 2 Trust identify First Capital Group as the lender, Orange Coast 3 Title Co. as the trustee, and Mortgage Electronic Registration 4 Systems, Inc. ( MERS ) as the beneficiary.2 5 The Deeds of (Id. Exhs. A-D.) By Assignments of Deed of Trust dated April 13th and 15th, 6 2009, MERS assigned to Defendant Indymac all its beneficial 7 interest under the Deeds of Trust encumbering the 5201 and 5203 8 Gorman Way properties. 9 Trustee Corps as trustee under the Deed of Trust for the 5201 On April 15, 2009, IndyMac substituted 10 Gorman Way property. 11 under the Deed of Trust for the 5203 Gorman Way property on June 5, 12 2009.3 13 IndyMac substituted Trustee Corps as trustee (Id. Exhs. G-H.) On April 17, 2009, Trustee Corps recorded notices of default 14 on the Gorman Way properties.4 15 defaults, Trustee Corps filed a Notice of Trustee s Sale for August 16 12, 2009 sale for 5201 Gorman Way and an August 13, 2009 sale for 17 5203 Gorman Way. After Mr. Mbaba failed to cure his (Id. Exhs. K-L.) 18 19 1 20 21 22 23 24 Trustee Corps request for judicial notice of this document was GRANTED. See § III(B), infra. 2 Specifically, the DOT on the 5201 Gorman Way property was assigned by MERS to IndyMac on April 13, 2009 and the DOT on the 5203 Gorman Way was assigned on April 15, 2009. (Id. Exhs. 3-4.) The assignments were recorded with the Kern County Recorder on August 18, 2009 and September 1, 2009. (Id. Exhs. E-F.) 3 25 26 27 28 The Substitutions of Trustee were recorded in Kern County on July 23, 2009 (5201 Gorman Way) and July 28, 2009 (5203 Gorman Way). 4 On April 17, 2009, the amount to cure default on the 5201 Gorman Way property was $6,760.65 and $4,866.44 on the 5203 Gorman Way property. 2 1 On August 11, 2009, Plaintiff filed this case in the Superior 2 Court of California, County of Kern, alleging seven causes of 3 action: (1) Injunction of Defendants Notice of Trustee Sales; (2) 4 Housing Discrimination; (3) Fraud; (4) Unjust Enrichment; 5 Breach of Contract; (6) Compensatory Damages; and (7) Punitive 6 Damages. 7 The (5) (Doc. 1., Exh. A (the Complaint ).) substance of the complaint is that IndyMac placed 8 Plaintiff in an unaffordable interest only loan which precluded 9 Plaintiff from the benefit of equity growth or protection of 10 Plaintiff s asset. (Compl. ¶ 8.) As a result of the housing 11 collapse, Plaintiff alleges he was left with little or no equity in 12 his home and could not sustain his loan payments. 13 According to Plaintiff, he requested a loan modification from 14 IndyMac in August 2008, but his request was denied. 15 Following IndyMac s refusal, Plaintiff alleges that IndyMac hired 16 [Trustee Corps] to substitute and illegally file notice of Trustee 17 sale of Plaintiffs [sic] without consideration to Plaintiff s 18 repeated application and request for loan modification. 19 13.) (Id. ¶ 9.) (Id. ¶ 10.) (Id. ¶ Plaintiff also alleges: 14. Defendants MTC Financial Inc. Dba Trustee Corps and IndyMac conspired among themselves to secretly acquire said assets for themselves with intent to unjustly enrich themselves and deprive Plaintiff of peaceful and fair opportunity to benefit from Plaintiff s own asset. 15. 20 Plaintiff is informed and believes that the Defendants IndyMac and MTC Financial Inc. Dba Trustee Corps jointly and individually by failure to consider Plaintiff s application for loan modification violated Plaintiff s Civil Rights and the Equal Opportunity Act (ECOA) and Fair Lending Sec. 801[42 U.S.C. 3601]. 21 22 23 24 25 26 27 28 (Id. ¶¶ 14-15.) 3 1 Plaintiff requests general, special, as well as punitive 2 damages in the sum of $500 million. 3 injunction to prevent Defendants proposed sale of Plaintiff s real 4 properties 5 Bakersfield, California, 93309; (b) 5203 Gorman Way Bakersfield, 6 California, 93309. 7 identified as follows: Plaintiff also requests an (a) 5201 Gorman Way, (Id. at 7:16-7:20.) On August 18, 2009, this case was removed on the basis of 8 federal question jurisdiction. 9 asserts that Plaintiff s action is founded on claims arising under 10 federal laws, including the Federal Housing Act ( FHA ), 42 U.S.C. 11 § 3601, et seq., and 12 1601, et seq. 13 (Doc. 1.) The notice of removal Truth in Lending Act ( TILA ), 15 U.S.C. § (Id.) Defendant Trustee Corps filed this motion on September 10, 14 2009. 15 suit should be dismissed with prejudice because the type of claims 16 alleged are targeted at the original lender which was not Trustee 17 Corps.5 18 to pursue claims under federal or state law. 19 (Doc. 7.) Defendant Trustee Corps asserts that Plaintiff s In any event, Defendant claims that Plaintiff has no basis The parties appeared before the court on October 26, 2009, for 20 argument on Defendant s motion to dismiss and motion to strike. 21 During the hearing, Plaintiff, who did not file an opposition, 22 requested an extension of time to obtain counsel and file an 23 opposition. The court granted the request and continued the 24 25 5 26 27 28 Specifically, Trustee Corps argues that it was merely the substitute trustee under the Deeds of Trust for purposes of foreclosure and not involved in the making of the subject loans to Plaintiff or the decisions not to renegotiate those loans. (Doc. 7, 3:15-3:18.) 4 1 hearing to January 25, 2010.6 On December 16, 2009, Plaintiff filed a single document 2 3 entitled: 1. Plaintiff s 4 Complaint 5 Plaintiff s 6 Defendants. 7 the Rule 56-260, Local Rules of Practice, governing motions for 8 summary judgment.7 9 Defendant s motion to dismiss pursuant to Local Rule 78-230(c). Against Notice Trustee and (Doc. 13.) Opposition Corps Motion For and To: Motion Motion Summary to to Dismiss Strike; Judgement 2. Against Plaintiff s filing does not comply with It is considered solely as an opposition to 10 In his opposition, Plaintiff maintains that the actions of 11 Defendant IndyMac [] and Defendant [Trustee Corps] were jointly 12 and individually collusive, fraudulent and with malice, oppression 13 and extreme indifference [sic] to Plaintiff s rights. 14 2:2-2:5.) 15 with notice of the foreclosure sale. (Doc. 13, Plaintiff also contends that he was not properly served (Id. at 2:6-2:7.) 16 III. 17 18 19 A. LEGAL STANDARD Motion to Dismiss Under Federal Rule of Civil Procedure 12(b)(6), a motion to 20 21 22 6 The court also set a supplemental briefing schedule: Plaintiff s opposition was due on or before December 22, 2009 and any reply was due on or before January 4, 2010. (Doc. 12.) 23 7 24 25 26 27 28 Specifically, Plaintiff s motion did not comply with Eastern District Local Rule 56-260(a). Pursuant to Local Rule 56260(a), [e]ach motion for summary judgment or summary adjudication shall be accompanied by a Statement of Undisputed Facts that shall enumerate discretely each of the specific material facts relied upon in support of the motion and cite the particular provisions of any pleading, affidavit, deposition, interrogatory answer, admission, or other document relied upon to establish that fact. 5 1 dismiss can be made and granted when the complaint fails to state 2 a claim upon which relief can be granted. 3 12(b)(6) is appropriate where the complaint lacks a cognizable 4 legal theory or sufficient facts to support a cognizable legal 5 theory. 6 (9th Cir. 1990). 7 To Dismissal under Rule Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 sufficiently state a claim for relief and survive a 8 12(b)(6) motion, a complaint does not need detailed factual 9 allegations but the [f]actual allegations must be enough to raise 10 a right to relief above the speculative level. Bell Atl. Corp. v. 11 Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). 12 Mere labels and conclusions or a formulaic recitation of the 13 elements of a cause of action will not do. 14 must be enough facts to state a claim to relief that is plausible 15 on its face. Id. at 570. In other words, [t]o survive a motion to 16 dismiss, 17 accepted as true, to state a claim to relief that is plausible on 18 its face. Ashcroft v. Iqbal, --- U.S. ----, 129 S.Ct. 1937, 1949, 19 173 L.Ed.2d 868 (2009) (internal quotation marks omitted). The 20 plausibility standard is not akin to a probability requirement, but 21 it asks for more than a sheer possibility that a defendant has 22 acted unlawfully. Where a complaint pleads facts that are merely 23 consistent with a defendant's liability, it stops short of the line 24 between possibility and plausibility of entitlement to relief. 25 Id. (internal citation and quotation marks omitted). a complaint must contain Id. sufficient Rather, there factual matter, 26 In deciding whether to grant a motion to dismiss, the court 27 must accept as true all well-pleaded factual allegations. Iqbal, 28 129 S.Ct. at 1950. A court is not, however, required to accept as 6 1 true allegations that are merely conclusory, unwarranted deductions 2 of fact, or unreasonable inferences. 3 Warriors, 266 F.3d 979, 988 (9th Cir. 2001); see, e.g., Doe I v. 4 Wal-Mart Stores, Inc., --- F.3d ----, 2009 WL 1978730, at *3 (9th 5 Cir. July 10, 2009) ( Plaintiffs' general statement that Wal-Mart 6 exercised control over their day-to-day employment is a conclusion, 7 not a factual allegation stated with any specificity. 8 accept Plaintiffs' unwarranted conclusion in reviewing a motion to 9 dismiss. ). Sprewell v. Golden State We need not The Ninth Circuit has summarized the governing standard, in 10 11 light of Twombly and Iqbal, as follows: In sum, for a complaint 12 to survive a motion to dismiss, the non-conclusory factual content, 13 and reasonable inferences from that content, must be plausibly 14 suggestive of a claim entitling the plaintiff to relief. 15 U.S. Secret Service, 572 F.3d 962, 2009 WL 2052985, at *6 (9th Cir. 16 July 16, 2009) (internal quotation marks omitted). Moss v. 17 18 B. Requests for Judicial Notice 19 In connection with its motion to dismiss, Defendant Trustee 20 Corps submitted a request for judicial notice pursuant to Fed. R. 21 Evid. § 201: (1) a Deed of Trust, recorded on July 10, 2007, in the 22 Official Records of Kern County, California as Doc No. 0207143995; 23 (2) a Deed of Trust, recorded on July 10, 2007, in the Official 24 Records of Kern County, California as Doc No. 0207143993; (3) an 25 Assignment of Deed of Trust, recorded on July 10, 2007, in the 26 Official Records of Kern County, California as Doc No. 0207143996; 27 (4) an Assignment of Deed of Trust, recorded on July 10, 2007, in 28 the Official Records of Kern County, 7 California as Doc. No. 1 0207143994; (5) 2 September 3 California as Doc. No. 0209128874; (6) an Assignment of Deed of 4 Trust, recorded on August 18, 2009, in the Official Records of Kern 5 County, California as Doc. No. 0209120607; (7) a Substitution of 6 Trustee, recorded on July 23, 2009, in the Official Records of Kern 7 County, California as Doc. No. 0209106882; (8) 8 Trustee, recorded on July 28, 2009, in the Official Records of Kern 9 County, California as Doc. No. 0209109205; (9) a Notice of Default 10 and Election to Sell Under Deed of Trust, recorded on April 17, 11 2009, as Doc. No. 0209054670; (10) a Notice of Default and Election 12 to Sell Under Deed of Trust, recorded on April 17, 2009, as Doc. 13 No. 0209054674; (11) a Notice of Trustee s Sale Under Trust Deed, 14 recorded on July 23, 2009, as Doc. No. 0209054670; and (12) a 15 Notice of Trustee s Sale Under Trust Deed, recorded on July 28, 16 2009, as Doc. No. 0209109206. 1, an 2009, Assignment in the of Deed of Official Trust, Records of recorded Kern on County, a Substitution of 17 Federal Rule of Evidence 201(b) provides the criteria for 18 judicially noticed facts: A judicially noticed fact must be one 19 not 20 generally known within the territorial jurisdiction of the trial 21 court or (2) capable of accurate and ready determination by resort 22 to sources whose accuracy cannot reasonably be questioned. 23 subject to reasonable dispute in that it is either (1) As the above documents are all matters of public record, 24 Trustee Corps request for judicial notice is GRANTED. 25 Indem. Corp. v. Weisman, 803 F.2d 500, 504 (9th Cir. 1986) (a court 26 may take judicial notice of matters of public record outside the 27 pleadings on a motion to dismiss.); 28 F.Supp. 790, 792 (N.D. Cal. 1992) (taking judicial notice of 8 See MGIC W. Fed. Sav. v. Heflin, 797 1 documents in a county public record, including deeds of trust). 2 IV. 3 DISCUSSION 4 As a preliminary matter, Trustee Corps argues that, due to its 5 status as a foreclosure trustee, Plaintiff s complaint against it 6 is barred by the litigation privilege of Cal. Civil Code § 47(b). 7 Trustee Corps contends that the privilege, which is made applicable 8 in trustee sale proceedings, bars any tort action based on a 9 protected communication. 10 Non-judicial foreclosure sales are governed by a 11 comprehensive statutory scheme. 12 Civil Code §§ 2924 through 2924k, evidences a legislative intent 13 that a 14 adjudication of the rights of the borrower and lender. 15 Thrift and Loan Co. v. County Escrow, Inc., 123 Cal. App. 4th 24, 16 32 (2004) (quotation and citation omitted). 17 sale which is properly This scheme, which is found in conducted constitutes a final Royal Section 2924(d) qualifies as California Civil Code § 47 18 privileged communications the mailing, publication, and 19 delivery of foreclosure notices and performance of foreclosure 20 procedures. 21 Civil Code § 47 applies to tort claims other than malicious 22 prosecution. Hagberg v. California Federal Bank FSB, 7 Cal.Rptr.3d 23 803 (2004) ( As noted, the only tort claim we have identified as 24 falling outside the privilege established by section 47(b) is 25 malicious prosecution. ). The § 2924(d) privilege extended through California 26 Here, to the extent Trustee Corps acts as trustee involved 27 statutorily required mailing, publication, and delivery of notices 28 for nonjudicial foreclosures, and the performance of statutory 9 1 nonjudicial foreclosure procedures, Trustee Corps correctly asserts 2 that 3 privilege for a communication. 4 Cal. App. 4th 1508 (2007). 5 are subject to § 2924(d) immunity from tort claims. these are privileged communications under the qualified See, e.g., Garretson v. Post, 156 Trustee Corps foreclosure proceedings 6 7 A. 8 Plaintiff s first cause of action seeks injunctive relief 9 Injunctive Relief (Claim I) against Defendants. (Compl. ¶¶ 16-17.) However, a request for 10 injunctive relief by itself does not state a cause of action and is 11 properly raised as a separate motion. 12 Co., 107 Cal. App. 4th 967, 984-85 (2003). 13 is construed as derivative of all other alleged causes of action, 14 Plaintiff still bears the burden of showing that he is likely to 15 succeed on the merits, that he is likely to suffer irreparable harm 16 in the absence of preliminary relief, that the balance of equities 17 tip in his favor, and that an injunction is in the public interest. 18 Winter v. Natural Resources Defense Council, Inc., --- U.S. ----, 19 ----, 129 S.Ct. 365, 374 (2008); see also Munaf v. Green, --- U.S. 20 ----, ---- - ----, 128 S.Ct. 2207, 2218-19 (2008). Shamsian v. Atl. Richfield Even if this requests 21 Because a request for injunctive relief by itself does not 22 state a cause of action, this claim is dismissed for failure to 23 state a claim upon which relief may be granted as no underlying 24 basis for injunctive relied has been stated.8 Plaintiff also does 25 8 26 27 28 [T]he law is long-established that a trustor or his successor must tender the obligation in full as a prerequisite to challenge of the foreclosure sale. Vargas v. Reconstrust Co., No. CV-F-08-1683 LJO-TAG, 2008 WL 5101557 at *6 (E.D. Cal. Dec. 02, 2008)(citing U.S. Cold Storage v. Great Western Savings & Loan 10 1 not satisfy the Winters factors.9 2 injunctive relief is DISMISSED for failure to state a claim upon 3 which relief may be granted.10 Plaintiff s cause of action for 4 5 B. 6 The complaint's second claim is comprised of one paragraph, 7 Housing Discrimination (Claim II) however, the allegations relate only to IndyMac, not Trustee Corps: Defendants IndyMac set a usurious high interest rates for Plaintiff higher than the fair market rate because of Plaintiff s ethnic origin as African American and refused to modify Plaintiff s loan, causing undue financial hardship to Plaintiff. 8 9 10 11 (Compl. ¶ 19.) 12 Trustee Corps correctly observes that this claim fails to 13 allege any conduct by Trustee Corps in which it, in any way, 14 discriminated against Plaintiff on the basis of race. The 15 complaint has not appropriately identified with particularity the 16 conduct undertaken by Trustee Corps that he claims was unlawful. 17 For example, to support a violation of housing discrimination the 18 complaint alleges only that Defendant IndyMac set a usurious high 19 20 21 22 23 Assn., 165 Cal. App. 3d 1214, 1222 (1985)). Here, the complaint does not contain allegations that Plaintiff attempted to tender, or is capable of tendering, the value of the property. As Plaintiff has not alleged that he has made such an offer or contemplates making such an offer, he cannot challenge the foreclosure sale. 9 24 25 26 27 28 As explained in §§ IV(B)-(F), infra, Plaintiff s claim for injunctive relief does not satisfy the first Winters factor likelihood of success on the merits. This ends the inquiry under Winters. See Doe v. Reed, 586 F.3d 671, 681 n.14 (9th Cir. 2009) ( Because we conclude that Plaintiffs have failed to satisfy the first Winter factor - likelihood of success on the merits - we need not examine the three remaining Winter factors. ). 10 11 1 interest rate because of his ethnic origin as African American. 2 No other facts are alleged. 3 Trustee Corps discriminated against him based on his race; that 4 Trustee Corps participated in setting interest rates; or that 5 Trustee Corps resisted Plaintiff s attempts to obtain a loan 6 modification. 7 as substitute trustee, was involved in Plaintiff s initial loan 8 transaction 9 modification, The complaint does not allege that No factual allegations describe how Trustee Corps, or his other subsequent than to attempts pursue a to obtain trustee sale a loan following 10 Plaintiff s default. 11 and likely cannot, include a single fact that Defendant Trustee 12 Corps discriminated - or was involved in any aspect of his loan 13 transaction 14 insufficient to state a claim for housing discrimination. 15 - Under Iqbal, because the complaint does not, against Plaintiff based on race, the claim is The same reasoning applies to the arguments contained in 16 Plaintiff s opposition. 17 Trustee Corps has a historical practice of discrimination against 18 African American and the Latinos [sic], according to proof during 19 discoveries and trial. 20 not included in the complaint and, assuming it was, such an 21 allegation - without more - is insufficient to support a claim for 22 housing discrimination. 23 plaintiff pleads factual content that allows the court to draw the 24 reasonable 25 misconduct alleged." 26 Atlantic Corp. v. Twombly, 550 U.S. 544, 570.). 27 second cause of action for housing discrimination does not meet 28 this standard. inference In his opposition, Plaintiff argues that (Doc. 13, 4:12-4:13.) This allegation is A claim is plausible only when the that the defendant is liable for the Iqbal, 129 S.Ct. 1937, 1949 (quoting Bell The complaint s The motion to dismiss is GRANTED WITH PREJUDICE. 12 1 C. Fraud (Claim III) 2 The fraud claim alleges that Defendants Trustee Corps and 3 IndyMac systematically refuse[d] to consider plaintiff s request 4 and application for loan modification with intent to defraud 5 Plaintiff. 6 Defendants deprive[d] Plaintiff of his rightful asset and peaceful 7 enjoyment by providing misleading statements and applying delaying 8 tactics. (Compl. ¶ 21.) The fraud claim also alleges that (Id.) 9 Trustee Corps faults the claim s failure to satisfy Rule 10 9(b)'s particularity requirement and to distinguish and/or identify 11 the role of each defendant in the alleged fraudulent scheme. 12 Trustee Corps notes the absence of charging allegations against 13 it given that it was not involved in Plaintiff s loan.11 14 Rule 9(b) requires a party to state with particularity the 15 circumstances constituting fraud. In the Ninth Circuit, claims 16 for fraud and negligent misrepresentation must meet Rule 9(b)'s 17 particularity requirements. 18 N.A., 290 F.Supp.2d 1101, 1141 (C.D. Cal. 2003). 19 subject to dismissal when its allegations fail to satisfy Rule 20 9(b)'s heightened pleading requirements. 21 USA, 317 F.3d 1097, 1107 (9th Cir. 2003). 22 claim grounded in fraud under Rule 9(b) for failure to plead with 23 particularity is the functional equivalent of a Rule 12(b)(6) Neilson v. Union Bank of California, A fraud claim is Vess v. Ciba-Geigy Corp. A motion to dismiss a 24 11 25 26 27 28 Rule 9(b)'s particularity requirement applies to state law causes of action: [W]hile a federal court will examine state law to determine whether the elements of fraud have been pled sufficiently to state a cause of action, the Rule 9(b) requirement that the circumstances of the fraud must be stated with particularity is a federally imposed rule. Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1103 (9th Cir. 2003) (citations omitted). 13 1 motion to dismiss for failure to state a claim. Vess, 317 F.3d at 2 1107. 3 a short and plain statement of the claim showing that the pleader 4 is entitled to relief. As a counter-balance, Rule 8(a)(2) requires from a pleading 5 Rule 9(b)'s heightened pleading standard is not an invitation 6 to disregard Rule 8's requirement of simplicity, directness, and 7 clarity and has among its purposes the avoidance of unnecessary 8 discovery. 9 A pleading is sufficient under Rule 9(b) if it identifies the 10 circumstances constituting fraud so that the defendant can prepare 11 an adequate answer from the allegations. 12 F.3d 666, 671-672 (9th Cir. 1993) (internal quotations omitted; 13 citing Gottreich v. San Francisco Investment Corp., 552 F.2d 866, 14 866 (9th Cir.1997)). 15 explained: 16 17 18 19 20 21 22 23 24 25 McHenry v. Renne, 84 F.3d 1172, 1178 (9th Cir. 1996). The Ninth Circuit Neubronner v. Milken, 6 Court of Appeals has Rule 9(b) requires particularized allegations of the circumstances constituting fraud. The time, place and content of an alleged misrepresentation may identify the statement or the omission complained of, but these circumstances do not constitute fraud. The statement in question must be false to be fraudulent. Accordingly, our cases have consistently required that circumstances indicating falseness be set forth.... [W]e [have] observed that plaintiff must include statements regarding the time, place, and nature of the alleged fraudulent activities, and that mere conclusory allegations of fraud are insufficient. ... The plaintiff must set forth what is false or misleading about a statement, and why it is false. In other words, the plaintiff must set forth an explanation as to why the statement or omission complained of was false or misleading.... In certain cases, to be sure, the requisite particularity might be supplied with great simplicity. 26 27 28 In Re Glenfed, Inc. Securities Litigation, 42 F.3d 1541, 1547-1548 (9th Cir. 1994) (en 14 banc) (italics in original) 1 superseded by statute on other grounds as stated in Marksman 2 Partners, L.P. v. Chantal Pharm. Corp., 927 F.Supp. 1297 (C.D. Cal. 3 1996); see Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997) 4 ( fraud allegations must be accompanied by the who, what, when, 5 where, and how of the misconduct charged). 6 As to multiple fraud defendants, a plaintiff must provide 7 each and every defendant with enough information to enable them to 8 know what misrepresentations are attributable to them and what 9 fraudulent conduct they are charged with. Pegasus Holdings v. 10 Veterinary Centers of America, Inc., 38 F.Supp.2d 1158, 1163 (C.D. 11 Cal. 1998) (quoting In re Worlds of Wonder Sec. Litig., 694 F.Supp. 12 1427, 1433 (N.D. Cal. 1988)). 13 complaint 14 require[s] plaintiffs to differentiate their allegations when 15 suing more 16 separately of the allegations surrounding his alleged participation 17 in the fraud. 18 Cir. 2007) (quoting Haskin v. R.J. Reynolds Tobacco Co., 995 19 F.Supp. 1437, 1439 (M.D. Fla. 1998)). 20 suit involving multiple defendants, a plaintiff must, at a minimum, 21 identif[y] 22 fraudulent scheme. 23 Kayport Package Express, Inc., 885 F.2d 531, 541 (9th Cir.1989)). 24 In a fraud action against a corporation, a plaintiff must 25 allege the names of the persons who made the allegedly fraudulent 26 representations, their authority to speak, to whom they spoke, what 27 they said or wrote, and when it was said or written. 28 State Farm Mut. Auto. Ins. Co., 2 Cal. App. 4th 153, 157 (1991). to merely than the one lump Rule 9(b) does not allow a multiple defendant ... defendants and inform together each but defendant Swartz v. KPMG LLP, 476 F.3d 756, 764-765 (9th role of [each] In the context of a fraud defendant[ ] in the alleged Swartz, 476 F.3d at 765 (quoting Moore v. 15 Tarmann v. 1 The elements of a California are: (1) concealment or misrepresentation 3 nondisclosure); (2) knowledge of the falsity (or scienter ); (3) 4 intent to defraud, i.e., to induce reliance; (4) justifiable 5 reliance; and (5) resulting damage. Lazar v. Superior Court, 12 6 Cal.4th 631, 638 (1996). 7 action 8 requirement of intent to induce reliance. Caldo v. Owens-Illinois, 9 Inc., 125 Cal. App. 4th 513, 519 (2004). negligent representation, claim 2 for (false fraud The same elements comprise a cause of misrepresentation, except there is no 10 [T]o establish a cause of action for fraud a plaintiff must 11 plead and prove in full, factually and specifically, all of the 12 elements of the cause of action. 13 Cal. App. 4th 133, 156 (1996). 14 defendant thereby intended to induce the plaintiff to act to his 15 detriment in reliance upon the false representation and that the 16 plaintiff actually and justifiably relied upon the defendant's 17 misrepresentation in acting to his detriment. 18 App. 4th at 157. Conrad v. Bank of America, 45 There must be a showing that the Conrad, 45 Cal. 19 The complaint is severely lacking and fails to satisfy Rule 20 9(b) who, what, when, where and how requirements as to Trustee 21 Corps, as well the other defendants. 22 Mut. Auto. Ins. Co., 2 Cal. App. 4th 153, 157 (1991) (a plaintiff 23 asserting fraud against a corporate employer must allege the names 24 of the persons who made the allegedly fraudulent representations, 25 their authority to speak, to whom they spoke, what they said or 26 wrote, and when it was said or written. ) 27 establish fraud elements. 28 particular defendants, and the complaint s global approach is See Tarmann v. State Farm The complaint fails to The fraud allegations do not target 16 1 unsatisfactory.12 2 suggest no potential improvement from an attempt to amend. 3 third cause of action is DISMISSED WITH PREJUDICE against Defendant 4 Trustee Corps. The fraud claims' deficiencies are so severe to The 5 6 D. Unjust Enrichment (Claim IV) 7 The complaint s fourth cause of action alleges that 8 defendants actions amount to unjust enrichment based on the 9 usurious interest rates and conspiracy to injustly take possession 10 of plaintiff s assets. (Compl. ¶ 23.) 11 Trustee Corps moves to dismiss the claim on grounds that it 12 did not issue any loan to Plaintiff and, therefore, was not 13 enriched on that basis. 14 Corps states that it was only the foreclosure trustee and did 15 not tak[e] possession of Plaintiff s assets. 16 As to any alleged conspiracy, Trustee The elements of an unjust enrichment claim are the receipt of 17 18 19 20 21 22 23 24 25 26 27 28 12 The arguments included in Plaintiff s opposition are unpersuasive for the same reasons. Plaintiff contends that Trustee Corps told the Plaintiff that the loan for the Plaintiff was going to be modified [...] the Defendants never informed that Plaintiff that the property was going to be sold under foreclosure. (Doc. 13, 2:14-2:16.) Plaintiff also contends that Trustee Corps misled him and engaged in a secret plan to sell the Gorman Way properties to Real Estate Agents that have prior and ongoing business relationships with Defendant Trustee Corps. (Id. 2:21-2:22.) First, Trustee Corps role was limited - it was retained as substitute trustee in April 2009 and was not involved in the loan origination or modification. Second, neither Trustee Corps involvement nor its initiation of foreclosure proceedings were secret, as Plaintiff argues. Documents designating Trustee Corps as successor trustee were filed with Kern County Recorder on April 15, and June 5, 2009. Notices of Default and Notices of Trustee s Sales were filed in the Kern County Recorder s office on April 17, July 23, and July 28, 2009. 17 1 a benefit and unjust retention of the benefit at the expense of 2 another. Lectrodryer v. SeoulBank, 77 Cal. App. 4th 723, 726 3 (2000). The complaint does not plead the elements of a cause of 4 action for unjust enrichment against Trustee Corps. 5 complaint vaguely states that Defendants - presumably IndyMac - 6 refused to consider Plaintiff s request for a loan modification and 7 disrupted his peaceful enjoyment. 8 Iqbal. 9 identified. Instead, the This is insufficient under No enforceable duty to modify Plaintiff s loan has been how For instance, the complaint fails to specifically 10 allege Defendant Trustee Corps could have been unjustly 11 enriched when Plaintiff is in default on the loan; the complaint 12 also fails to allege how Trustee Corps was unjustly enriched when 13 its only involvement was as substitute trustee, a position which 14 does not require receiving payment or possessing the Gorman Way 15 properties. 16 Trustee Corps received anything of value by which it could be 17 unjustly enriched, no claim is stated. The unjust enrichment claim 18 is meritless as alleged and is DISMISSED. As Plaintiff does not allege any facts showing that 19 20 E. Breach of Contract (Claim V) 21 The complaint s fifth cause of action alleges breach of 22 contract in that Defendant IndyMac initially agreed to modify the 23 loan and offer a fair interest rate and then refused to consider 24 Plaintiff s application as agreed. 25 In California, [a] cause of action for breach of contract 26 requires proof of the following elements: (1) existence of the 27 contract; (2) plaintiff's performance or excuse for nonperformance; 28 (3) defendant's breach; and (4) damages to plaintiff as a result of 18 1 the breach. CDF Firefighters v. Maldonado, 158 Cal. App. 4th 2 1226, 1239 (2008). 3 loan 4 understood, alleges that IndyMac breached the mortgage contract 5 when it refused to modify the existing terms of his mortgage loan. 6 These 7 underlying Plaintiff s breach of contract claim, do not allege any 8 actions 9 describing an alleged refusal to modify a written note and deed of mortgage Plaintiff alleges that he entered into a home with allegations, or conduct IndyMac, which with and, purport respect to to to the extent describe Trustee it the can be contract Corps, instead 10 trust on the part of IndyMac. The complaint s inadequacy is best 11 demonstrated by its failure to allege the most basic fact of a 12 breach of contract claim: the existence of a contract.13 13 The complaint fails to allege a viable breach of a contract 14 claim against Trustee Corps. The motion is GRANTED WITH PREJUDICE. 15 16 F. Compensatory and Punitive Damages (Claims VI-VII) 17 The complaint's sixth and seventh causes of action for 18 compensatory damages and punitive damages request appropriate 19 relief because Plaintiff lost money on the properties and overpaid 20 interest to Defendant IndyMac and the conduct of ... Trustee 21 13 22 23 24 25 26 27 28 Specifically, Plaintiff fails to allege a contract existed between himself and Defendant Trustee Corps. In his opposition, Plaintiff s argues that Trustee Corps breached its contract with Plaintiff when it substituted for IndyMac [...] such contractual obligations were expressly transferred to Defendant Trustee Corps. (Doc. 13, 4:18-4:20.) This is factually incorrect. Trustee Corps substituted in as trustee to conduct the foreclosure, nothing more. It did not purchase the loan or otherwise take ownership of the mortgage loan or its payments. Trustee Corps was not a party to the loan agreement. Without a contract between the parties, there is no breach. See, e.g., CDF Firefighters, 158 Cal. App. 4th at 1239. 19 1 Corps was 2 conscious disregard to Plaintiff s rights and with oppression 3 subjecting Plaintiff to cruel and unjust hardship. (Compl. ¶¶ 27, 4 29.) 5 with malice intended to injure Plaintiff and with Trustee Corps correctly observes that these claims only seek 6 a remedy, and do not state an underlying claim. They otherwise 7 fail because Plaintiff s other claims are inadequate. 8 and seventh claims are DISMISSED WITH PREJUDICE. The sixth 9 10 G. Punitive Damages 11 The complaint, in its seventh claim and its concluding prayer 12 for relief, seeks punitive damages in the sum of $500 million. 13 Trustee Corps moves to strike the punitive damages claims in the 14 absence of viable claim to support a punitive damage award. 15 Rule 12(f) empowers a court to strike from a pleading any 16 redundant, immaterial, impertinent, or scandalous matter. Motions 17 to strike may be granted if it is clear that the matter to be 18 stricken could have no possible bearing on the subject matter of 19 the litigation. 20 F.Supp. 820, 830 (N.D. Cal. 1992); Colaprico v. Sun Microsystems, 21 Inc., 758 F.Supp. 1335, 1339 (N.D. Cal. 1991). [T]he function of 22 a [F.R.Civ.P.] 12(f) motion to strike is to avoid the expenditure 23 of time and money that must arise from litigating spurious issues 24 by dispensing with those issues prior to trial. 25 v. A.H. Robins Co., 697 F.2d 880, 885 (9th Cir. 1983). 26 to strike may be used to strike any part of the prayer for relief 27 when the damages sought are not recoverable as a matter of law. 28 Bureerong v. Uvawas, 922 F.Supp. 1450, 1479, n. 34 (C.D. Cal. LeDuc v. Kentucky Central Life Ins. Co., 814 20 Sidney-Vinstein [A] motion 1 1996). Absent viable claims, Plaintiff cannot state a claim for 2 3 punitive damages. 4 The motion to strike the punitive damages claim is GRANTED. 5 6 H. Attempt At Amendment 7 Plaintiff s claims are insufficiently pled and barred as a 8 matter of law. 9 allegation of other facts and in view of futility is not granted 10 leave to amend. 11 Plaintiff is unable to cure his claims by Defendant Trustee Corps motion is GRANTED WITH PREJUDICE. 12 V. CONCLUSION. 13 14 For the reasons stated: 15 (1) All claims against Trustee Corps are DISMISSED WITH 16 PREJUDICE; and 17 (2) 18 Defendant s motion to strike the punitive damages claim is GRANTED. 19 Defendant 20 Trustee Corps shall submit a form of order 21 consistent with, and within five (5) days following electronic 22 service of, this memorandum decision. 23 24 IT IS SO ORDERED. 25 Dated: aa70i8 January 27, 2010 /s/ Oliver W. Wanger UNITED STATES DISTRICT JUDGE 26 27 28 21

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